"Sales fell 35.1 percent from September 2016, the Toronto Real Estate Board (TREB) said in a report. It was the sixth straight month of declining year-on-year sales after a years-long boom that sparked fears of a bubble. "
Why humans still willingly choose to live in this remote wasteland is beyond me.
StL Edit - For many reasons. You’ve asked me to help you stop posting here. You’ve promised not to post here. You’re a troll. And on and on…I could just ban you, but you’re part of an experiment I’m conducting.
headlines are funny. you can make them have whatever spin you want. in important news, TO house prices are up 6% month-over-month, the first month-over-month price increase since april. and the easy to predict rally back to the april 2017 highs ensues.
NY rent is really expensive, but people make more money here too. Plus, there are so many people that even after the 90% of people who can’t tolerate the rent move further out, the remaining 10% is still an overwhelming, crushing amount of people. Sure, your 2br in Tribeca is like $7k a month, but the average income of people who rent those is probably like $500k… I don’t think you can walk into the run of the mill office in Toronto or most other cities and find it’s full of people with high income levels.
While I agree that people in New York, and people in general, tend to spend more money than they should, I don’t think the rent/income ratio I mentioned above is more unreasonable than other places given other financial circumstances. Let’s say you earn $500k and receive $300k after taxes. After spending $84k on rent, you still have $216k to satisfy your other living needs. This is a lot of money, and you should still be able to save over $100k a year. In six or seven years or so, after investing those savings, you should have $1 million. People in New York typically do not own cars either - transportation is usually the second highest spending category in most household budgets. The subway costs about $100 a month.
@ elcoelhon - your not going to find any apartments for less than $1k /month in Toronto.
@ ohai - but how many people in NYC are making say $500k / year? Plus if your making that kind of cash your more likely to be living in a swanky neighborhood and rent could even be higher (I don’t know)? Plus dining out and entertainment expenses would probably be higher as well.
high income pushes rents higher and vice versa… new york is lucky to have the economy to support this.
New York population: 8.5m, Global financial centre, global corporate hub, arguably top three city in the world versus Toronto, 2.8m, regional hub, Top 3 city in Canada, no guns, aims for wage equality…not exactly a fair comparison.
It’s not uncommon for people here to have that income. When you consider 2 income households, it’s almost a prerequisite to earn that if you live in certain parts of the city. There are many combinations that will add to $500k total. A normal lawyer, mid level corporate manager, software engineer, or run of the mill non-front office finance worker can make $250k. If you are a surgeon, IB/Trader, or law firm partner, you will make $500k to $1 million or more if you’re in your mid 30s. If you live in a place with $7k rent, you are most likely in one of these categories.
It’s true that many people have lower income than this, but then, you’d be living somewhere else. There are other, more affordable, neighborhoods in the city, compared to the one I mentioned.
You are correct that dining and entertainment typically constitute a large part of urban people’s budgets. In fact, even mundane expenses like groceries are more expensive in the city than elsewhere. However, I have hopefully taken that into account in my calculation above. $116k a year seems like a fairly generous allocation for non-housing expenses. Keep in mind that in addition to saving money on transportation (someone with $500k of income in a suburb might easily spend $1k a month on cars), utility costs are also low, and home maintenance costs in an apartment are almost non existent. People who live in large houses in the suburbs probably spend $500 a month on utilities during the winter. My gas and electric bill in the city is close to $70 a month.
the reality is that the difference really doesn’t have much to do with incomes. the difference is how long has static capital been deployed in each city. this is what the argument for the permanance of toronto’s house price gains relies on. why are toronto and sydney much cheaper than Moscow, Paris, Rome, London, NYC, San Fran and Tokyo? because toronto and sydney have not seen the amount of investment in property as these cities have over the past 100-1000 years. toronto and sydney are products of china’s great rise to prominence. if china remains prominent, toronto and sydney will likely continue to see appreciation and could eventually reach parity with these global cities. people only see toronto and sydney as expensive because they used to be really cheap. if toronto and sydney are changing, like Moscow, Paris, Rome, London, NYC, San Fran and Tokyo all changed in the past, then the gains could be permanent.
also, toronto is not a top 3 city in canada. there is no comparing toronto to montreal, vancouver or calgary. that’s like comparing NYC to chicago.
personally, i think toronto, vancouver and all of the australian cities will continue to see price appreciation until china eventually implodes. by my estimate this should occur between 2025 and 2040 using dalio’s charts. the chinese population in my city has doubled in the past ten years. my old neighborhood went from ~25% chinese to ~75% chinese in four years. i was just talking to a guy who grew up in vancouver. he showed me a picture of his classes from school. from 1990 to 2002, the % of chinese in his class went from 10% to 90%. it is crazy. this trend will likely grow exponentially as china ramps up capital controls and as the chinese economy nears ‘peak debt’.